Fannie Mae Loan Costs Skyrocket. Is FHA A Cheaper Deal?

FNMA increased fee chart effective Jan. 2011

 

The rumour has turned into reality as Fannie Mae has increased their fees for consumers to obtain a California home loan.  It boggles my mind as to why they would choose to do this now.  Our industry needs a shot in the arm and a instead they’ve given consumers a nasty flu bug that will have lasting affects.

The timing of this new Fannie Mae increase in fees couldn’t be worse.  Right as the traditional buying season kicks off, when people are motivated to buy and start looking for a home to purchase, this new release gives consumers a reason to not want to buy.  Take a look at some of the adjustments.

A consumer who a downpayment of 20%, and a 660 FICO score now has to pay an additional 2.5% in points upfront to get their loan.  This means on a California real estate loan amount of $300,000 it will cost an additional $7,500.00 more in closing costs to obtain this loan than yesterday.  The chart pictured to the left features the additional FNMA fees.

FHA did not increase their fees so this may mean that their market share may go up.  Do you think that the increased fees can hinder the ability for some homebuyers to qualify?  Absolutely!  It’s hard enough for many to come up with the downpayment and closing costs and now these added fees?  A California first time homebuyer mortgage seeker is going to have to possibly look into getting an unplanned gift from Mom and Dad in order to obtain their home.

Refinance home loans you ask?  They are affected as well.  No Fannie Mae loan goes untouched.  Talk about a stick in the mud!

If you have a question in regards to this article click here and let me know your scenario!

Best Kevin Walton

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